Latest news with #FedRateCut
Bloomberg
21-07-2025
- Business
- Bloomberg
Expect 100 BP of rate cuts in next year: JPMorgan's Santos
Gabriela Santos, JPMorgan Asset Management Chief Market Strategist for the Americas, says the day-to-day is being driven by earnings results and AI rather than policy changes; she also believes the Fed will cut rates by as much as 100 basis points over the next 12 months. She speaks with Romaine Bostick on 'Bloomberg: The Close.' (Source: Bloomberg)
Yahoo
18-07-2025
- Business
- Yahoo
Dollar Weakens as a Fed Official Calls for Rate Cuts
The dollar index (DXY00) Friday fell by -0.24%. The dollar came under pressure today following comments from Fed Governor Christopher Waller on Thursday evening, who stated that he supports a Fed interest rate cut at the July 29-30 FOMC meeting. Also, an easing of inflation expectations in today's University of Michigan July inflation expectations report was dovish for Fed policy and bearish for the dollar. Losses in the dollar were limited Friday due to the stronger-than-expected US housing starts and building permits reports. Also, the University of Michigan's US July consumer sentiment index rose more than expected to a 5-month high, a bullish factor for the dollar. More News from Barchart Could the Pentagon's $550 Million Bet on Rare Earths Signal the Next Market Boom? Solid US Economic News Lifts the Dollar Dollar Falls on Dovish Comments from a Fed Official Tired of missing midday reversals? The FREE Barchart Brief newsletter keeps you in the know. Sign up now! US June housing starts rose +4.6% m/m to 1.321 million, stronger than expectations of 1.300 million. Also, Jun building permits, a proxy for future construction, unexpectedly rose +0.2% m/m to 1.397 million versus expectations of a -0.5% m/m decline to 1.387 million. The University of Michigan's US July consumer sentiment index rose +1.1 to a 5-month high of 61.8, stronger than expectations of 61.5. The University of Michigan US July 1-year inflation expectations indicator fell to a 5-month low of +4.4%, better than expectations of no change at +5.0%. Also, the July 5-10 year inflation expectations indicator eased to a 5-month low of +3.6%, weaker than expectations of +3.9%. Thursday evening, Fed Governor Christopher Waller said, "With inflation near target and the upside risks to inflation limited, we should not wait until the labor market deteriorates before we cut the policy rate. I believe it makes sense to cut the FOMC's policy rate by 25 basis points two weeks from now." On the trade front, President Trump said late Wednesday that he intends to send a tariff letter to more than 150 countries notifying them their tariff rates could be 10% or 15%, effective August 1, and that the group was "not big countries who don't do that much business with the US." Federal funds futures prices are discounting the chances for a -25 bp rate cut at 5% at the July 29-30 FOMC meeting and 58% at the following meeting on September 16-17. EUR/USD (^EURUSD) Friday rose by +0.20%. Dollar weakness on Friday sparked gains in the euro after Fed Governor Waller said he supports a Fed rate cut later this month. Friday's Eurozone economic news was negative for the euro after Eurozone May construction posted its biggest decline in 2.5 years and German June producer prices fell at the steepest pace in 9 months, which are dovish factors for EBC policy. Eurozone May construction output fell -1.7% m/m, the biggest decline in nearly 2.5 years. German June PPI fell -1.3% y/y, right on expectations and the steepest pace of decline in 9 months. Gains in the euro were also limited Friday after the Financial Times reported that President Trump is pushing for a minimum tariff of 15%-20% in any trade deal with the European Union (EU), as Mr. Trump has been unmoved by the latest EU offer to reduce car tariffs. Also, the Financial Times said that EU trade commissioner Sefcovic gave a downbeat assessment of recent trade talks in Washington on Friday to EU ambassadors. Swaps are pricing in a 1% chance of a -25 bp rate cut by the ECB at the July 24 policy meeting. USD/JPY (^USDJPY) Friday rose by +0.11%. The yen on Friday gave up an early advance and turned lower as it remains under pressure ahead of Sunday's upper house election in Japan, where there is concern that Japanese Prime Minister Ishiba's Liberal Democratic Party (LDP) could lose its majority. The promises by Japan's ruling Liberal Democratic Party of cash handouts to voters and promises of lower taxes by the opposition have sparked concerns of fiscal deterioration, which are bearish for the yen. The yen initially moved higher against the dollar on Friday after Japan's June national CPI ex-fresh food and energy rose at the fastest pace in 17 months, a hawkish factor for BOJ policy. Also, lower T-note yields on Friday were bullish for the yen. Japan's June national CPI rose +3.3% y/y, right on expectations. June national CPI ex-fresh food and energy rose +3.4% y/y, stronger than expectations of +3.3% y/y and the largest increase in 17 months. August gold (GCQ25) on Friday closed up +13.00 (+0.39%), and September silver (SIU25) closed up +0.161 (+0.42%). Precious metals settled higher on Friday due to a weaker dollar. Also, lower T-note yields on Friday were bullish for precious metals. Dovish comments from Fed Governor Waller on Thursday evening boosted demand for precious metals as an inflation hedge, as he expressed support for a Fed interest rate cut at the July 29-30 FOMC meeting. Precious metals also received safe-haven support from global trade tensions, following President Trump's announcement on Wednesday that he intends to send a tariff letter to more than 150 countries, notifying them that their tariff rates could be 10% or 15%, effective August 1. Strength in US economic news on Friday is hawkish for Fed policy and limited gains in precious metals. Housing starts and building permits reports for June were better than expected. Also, the University of Michigan US July consumer sentiment index rose more than expected to a 5-month high. On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Sign in to access your portfolio
Wall Street Journal
16-07-2025
- Business
- Wall Street Journal
Gold Edges Higher on Possible Position Adjustments
2340 GMT — Gold edges higher in the early Asian session on possible position adjustments. However, diminishing Fed rate-cut expectations spurred by U.S. CPI data released overnight could cap gains. Also, the U.S.' passage of the 'One Big Beautiful Bill Act' and coming trade deals help reduce U.S. growth worries and weigh on gold demand, Citi Research's Kenny Hu says in a research report. 'We continue to highlight our view that we may have seen gold price highs at $3,500/oz as the market deficit is peaking soon, if not already,' the analyst adds. Spot gold is 0.2% higher at $3,330.11/oz. (
Yahoo
05-07-2025
- Business
- Yahoo
The jobs report has dashed hopes of a rate cut this summer
Chances of a Fed rate cut this month cratered after the strong June jobs report. The economy added 147,000 jobs in June, way more than economists expected. The Trump administration continued to criticize the Fed chair this week for not lowering rates. Say goodbye to the prospect of a rate cut this summer. Investors have slashed the odds of an interest rate cut from the Federal Reserve this month after data released Thursday indicated the job market was unexpectedly strong in June. The robust jobs report gives the central bank room to keep interest rates elevated, with employment strong and inflation remaining above its 2% target. The report indicated that employers added 147,000 jobs to the economy last month, handily beating expectations of 110,000. In another sign of strength, payrolls for May were revised upward to 144,000, and the overall unemployment rate unexpectedly ticked down to 4.1% from 4.2%. This embedded content is not available in your region. According to the CME FedWatch tool, the perceived chances of the Fed cutting rates by 25 basis points plunged Thursday morning, dropping from a 23.8% chance Wednesday to 6.7% after the release of the jobs report. Markets still see a September rate cut as likely, with odds of about 71% after the jobs report. Stocks moved slightly higher as traders cheered the strong data, but dimmer rate-cut views kept a lid on more pronounced gains. Still, the S&P 500 managed to rise to a fresh intraday record of 6,271. The bigger reaction to the jobs data was in the bond market. This embedded content is not available in your region. Yields jumped on the prospects for the Fed to keep rates higher for longer. The 10-year US Treasury yield jumped 4 basis points to about 4.34%. The yield on the 2-year Treasury, which is the most sensitive to Fed policy, spiked 9 basis points to 3.88%. "The firm June unemployment rate waves the Federal Reserve off the possibility of a July rate cut, which shifts the spotlight to September," Mark Hamrick, a senior economic analyst at Bankrate, wrote in a note. "If businesses keep expanding payrolls like they've done so far this year, the Fed can comfortably sit in 'wait and see' mode at the upcoming policy meeting. Uncertainty around tariffs and trade have apparently not spooked businesses into shedding workers," said Jeffrey Roach, the chief economist at LPL Financial. The report is unlikely to lead to rate cuts this month, which means the Trump administration's withering criticism of Fed Chair Jerome Powell could intensify. Powell has signaled the central bank is comfortable holding interest rates steady while the central bank monitors the path of inflation and any impact from tariffs. This week, Powell said the Fed would have cut rates already were it not for Trump's trade war. Trump, who has harangued Powell to cut rates for years, posted on Truth Social on Wednesday suggesting the Fed chief leave his position. "'Too Late' should resign immediately!!!" Trump wrote, referring to the nickname he has frequently called Powell to express his annoyance at not cutting interest rates earlier. Trump's post also linked to an article detailing a post on X from William Pulte, the FHFA director, who suggested that Congress should investigate Powell. Pulte has criticized Powell for hurting the housing market by keeping rates high. "Like this tweet if you think it's time for Jerome Powell to resign," Pulte said in a separate post Wednesday evening. According to the latest Freddie Mac survey, the 30-year US fixed mortgage rate hovered at about 6.77% last week. Still, Powell looks likely to stand pat on interest rates, even amid escalating political pressure, Bankrate's Hamrick said. "He is determined to serve out the remainder of his term not being swayed by political pressure or blunt criticism from the president," he added. "Indeed, the president's pressure could have the opposite of the intended impact." Others have speculated that Trump's criticism only makes it less likely that Powell will bend and lower rates. Observers say Powell may now be more focused on his legacy of protecting Fed independence. Read the original article on Business Insider Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
25-06-2025
- Business
- Yahoo
Dollar Pressured by Dovish Fed Comments
The dollar index (DXY00) on Monday fell by -0.33%. The dollar on Monday dropped from a 3-week high and turned lower on dovish Fed comments. Fed Governor Bowman and Chicago Fed President Goolsbee said they favored a Fed rate cut at next month's FOMC meeting. Also, Monday's rebound in stocks curbed liquidity demand for the dollar. In addition, Monday's fall in the 10-year T-note yield to a 6-week low weighed on the dollar's interest rate differentials. The dollar initially rallied to a 3-week high Monday after the weekend attack by the US on Iran's nuclear facilities boosted safe-haven demand for the dollar. The dollar also found support from the stronger-than-expected US PMI and existing home sales reports. Palantir, Nuclear Stocks, and the Put/Call Ratio: Key Stocks, Sectors, and Indicators on Watch After U.S. Strikes on Iran Dollar Pressured by Dovish Fed Comments Dollar Firms on Escalation of Middle East Tensions Tired of missing midday reversals? The FREE Barchart Brief newsletter keeps you in the know. Sign up now! The June S&P US manufacturing PMI was unchanged at 52.0, stronger than expectations of a decline to 51.0. US May existing home sales unexpectedly rose +0.8% m/m to 4.03 million versus expectations of a -1/3% m/m decline to 3.95 million. Fed Governor Bowman said, 'Should inflation pressures remain constrained, I would support lowering the fed funds policy rate as soon as our next meeting in order to bring it closer to its neutral setting and to sustain a healthy labor market.' Chicago Fed President Goolsbee said the Fed could resume interest rate cuts if the inflation hit from tariffs remains subdued. The markets are discounting the chances at 23% for a -25 bp rate cut after the July 29-30 FOMC meeting. EUR/USD (^EURUSD) Monday rose by +0.42%. The euro recovered from early losses on Monday and rallied after the dollar gave up an early advance and sank on dovish Fed comments. The euro on Monday initially moved lower due to weaker-than-expected Eurozone June PMI reports. Also, dovish comments on Monday from ECB Governing Council member Centeno undercut the euro when he said the Eurozone economy needs more ECB stimulus. The June S&P Eurozone manufacturing PMI was unchanged at 49.4, weaker than expectations of an increase to 49.7. Also, the June S&P Eurozone composite PMI was unchanged at 50.2, weaker than expectations of an increase to 50.4. ECB Governing Council member Centeno said, 'The supply and demand conditions are still too weak in the Eurozone to allow a return to the 2% inflation target without further stimulus.' Swaps are discounting the chances at 6% for a -25 bp rate cut by the ECB at the July 24 policy meeting. USD/JPY (^USDJPY) Monday rose by +0.07%. The yen tumbled to a 1-1/4-month low against the dollar today on concern that rising energy costs will derail Japan's economy after the escalation of Middle East hostilities pushed crude prices up to a 5-1/4 month high. The yen also fell after Japanese officials denied a Financial Times report that said the US asked Japan to raise its defense spending to 3.5% of annual GDP. However, the yen recovered most of its losses on Monday after T-note yields plunged following dovish comments from the Fed. The yen also garnered support from Monday's Japanese economic news, which showed that the June Jibun Bank Japanese manufacturing PMI expanded at its fastest pace in 13 months. In addition, the Japan Finance Ministry's cut in its long-term bond sales was supportive for the yen. The June Jibun Bank Japan manufacturing PMI rose +1.0 to 50.4, the highest level in 13 months. The Japanese Finance Ministry said it will reduce the volume of 20-year, 30-year, and 40-year bonds sold in auctions by a combined 3.2 trillion yen ($21.7 billion) starting in July through the end of March 2026. August gold (GCQ25) Monday closed up +9.30 (+0.27%), and July silver (SIN25) closed up +0.170 (+0.47%). Precious metals moved higher Monday after the US launched attacks over the weekend on Iran's nuclear facilities, escalating tensions in the Middle East and prompting some safe-haven demand for precious metals. Lower global bond yields on Monday were also supportive of precious metals. In addition, dovish central bank comments boosted demand for precious metals as a store of value. Fed Governor Bowman and Chicago Fed President Goolsbee said they support a Fed rate cut at next month's policy meeting, and ECB Governing Council member Centeno said the Eurozone economy needs more ECB stimulus. Fund buying of gold and silver continues to support prices. Gold holdings in ETFs rose to a 1-3/4 year high last Friday, and silver holdings in ETFs rose to a 2-3/4 year high. Monday's rally in stocks limited the upside in precious metals. Also, Iran's meager retaliation attempt against the US for attacking its nuclear facilities reduced safe-haven demand for precious metals after missile attacks by Iran on US bases in Qatar were intercepted with no damage done to US assets. On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on
